Pharma Ethics

The thalidomide tragedy, which resulted in thousands of deaths and disabilities in the late 1950s and early 1960s, changed medicine forever. One of its outcomes was the establishment of more robust mechanisms for the regulation of medicines and medical devices.

There is no doubt that the tightening of regulation has prevented countless deaths and disabilities, and saved many lives. But regulation cannot always protect us from harm and events disturbingly similar to the thalidomide tragedy continue to occur. Let’s look at two recent examples.

Vioxx pain drugs

In the 1990s, a new class of anti-inflammatory medicines emerged – the “COX 2 inhibitors”. These pain drugs were touted as being less likely to cause gastric ulceration than existing treatments.

One of these, rofecoxib (Vioxx), manufactured by Merck, was later withdrawn from the market, when it emerged that it increased the risk of myocardial infarction (heart attacks).

It emerged that the company had deliberately misinterpreted and concealed some of the information it had about these risks, thus delaying the withdrawal of Vioxx from the market.

Questions were also raised about conflicts of interest – on the part of academic researchers who collaborated with Merck in running trials of Vioxx, members of the data safety monitoring board whose job it was to monitor trials of Vioxx, and members of FDA committees who assessed Vioxx.

A number of class action lawsuits have followed, including one in Australia in 2010, which ruled against Merck. This decision was subsequently reversed, but this was because the judges decided it was not possible to causally link the particular claimant’s heart attack to his use of Vioxx.

Merck has subsequently come to a settlement agreement with Australian patients.

DePuy hip replacements

Yet another class action lawsuit concluded in Australia this June. The action was brought against DePuy International Ltd and Johnson & Johnson Medical Pty Ltd, which were accused of being negligent in their design, manufacture and supply of a particular kind of hip implant.

The story leading up to this will sound familiar: a promising new medical device – the DePuy ASR hip implant – was developed and marketed in the mid-2000s. The company claimed these implants would would reduce friction and wear, and improve patients’ mobility.

Complication rates soon proved to be much higher than expected. Around 2,000 of the 5,500 Australians who received the device have required, or are expected to require, revision surgery.

The device was finally withdrawn in Australia in 2009 and worldwide in 2010.

The company has subsequently been accused of not testing the implant adequately, and of knowing – and denying – that its device did not meet manufacturing specifications.

As with the Vioxx case, concerns have been raised about possible conflicts of interest on the part of some of the surgeons who recommended the implant to their patients, and the regulators who evaluated it.

Is there more to come?

These two eerily similar events raise the question: can we do anything to reduce the likelihood of similar occurrences in future?

There is certainly scope to tighten our governance of the pharmaceutical and medical device industries, and the behaviour of those who interact with them. We can also make our regulation of new medicines – and devices and surveillance of existing products – more robust.

There are, however, several important limits to our capacity to prevent harms from medicines and medical devices – all of which help to explain why history keeps repeating itself.

First, pharmaceutical and medical device companies are commercial entities which invest billions of dollars in developing new medicines and devices. Tight regulations are in place and outright fraud is fortunately very rare.

The commercial imperative is, however, powerful. As a result, there is always the possibility that studies of new medicines and devices will be designed, and their results interpreted and disseminated, in a manner that overstates their benefits, and underplays their risks.

Second, most patients who are injured by medicines and medical devices sustain these injuries in the course of routine medical or surgical therapy – either because of unpredictable adverse events, such as allergic reactions to antibiotics, or because of unintended medical errors.

The adage that “all medicines are poisons” is, unfortunately, true, and we need to accept that even the best physicians and surgeons are only human and will inevitably make mistakes.

Third, we need to balance our desire for innovation and access to new technologies against our desire for safety and control. While there is definitely room to improve regulation and surveillance, we don’t want our clinicians and regulators to be so risk-averse that health technologies cannot make it onto the market or survive once they get there.

Finally, while we might like to think that academic researchers, clinicians and regulators are committed solely to their the pursuit of knowledge, patients and the general public, the reality is they all need to earn money, and attract funding for their work. This inevitably creates a situation in which their “primary commitments” compete or conflict with other loyalties or with self-interest.

We need to accept that “conflicts of interest” are part and parcel of all social roles. Therefore, there will never be a group of people whose only commitment is to protect patients.

When this sobering fact of human nature is combined with the dangers of the commercial imperative, the inevitability of unpredictable side-effects and medical errors, and the need to balance our desires for safety against our desire for innovation, the future looks uncertain.

The best we can hope for is that our systems of checks and balances will continue to be refined so that the “thalidomides of the future” will be caught and addressed as early as possible.

Their call is motivated by the astronomical prices charged for some new cancer drugs. And Australia is in the same boat. Earlier this year, for instance, the Pharmaceutical Benefits Scheme (PBS) started subsidising pembrolizumab (Keytruda) for the treatment of patients with advanced melanoma. The drug is expected to cost A$150,000 per patient for each year of treatment, which is almost twice the national average annual income.

Unlike in the United States, where patients’ insurance covers the costs, the Australian taxpayer subsidises drugs listed on the PBS. In cases where new drugs are not subsidised, they’re paid for directly by patients, or by state-funded hospitals (often after approval by drug committees). They can also be provided free or subsidised by pharmaceutical companies for “compassionate use”.

Blurred by emotion

Decisions to subsidise drugs and improve their accessibility should be based on an assessment of their value. In Australia, for instance, the Pharmaceutical Benefits Advisory Committee examines new drugs for effectiveness, safety and value for money compared to other treatments before recommending PBS listing – or not.

But the imperative to “save lives” or “beat cancer” — particularly where there’s vigorous public, professional and industry advocacy — can be so profound that it overwhelms the requirement that medicines should be efficacious and cost-effective. This tension between emotional and economic considerations frequently challenges and compromises public decision-making about the value of drugs.

Consider the case of eribulin (Halaven), a drug for treating advanced breast cancer. The UK National Institute for Health and Clinical Excellence (NICE is the rough equivalent of PBAC although it has a broader role) considered the drug but rejected it as too expensive.

Eribulin was subsequently covered by the UK Cancer Drugs Fund, a pool of public money allocated to pay for drugs not approved via the usual route. The price accepted by the fund was among the highest in Europe for the drug; the price rejected by NICE had been the lowest.

Clearly, when standards of cost-effectiveness are reduced in the name of “improved access”, prices can rise arbitrarily. In most markets, supply and demand, competition and consumer choice curtail such arbitrary fluctuations in price.

But the market for innovative cancer drugs doesn’t follow this pattern because prices can increase dramatically even in “growing” markets, without clear reasons. In 2013, for example, a group of experts in chronic myeloid leukemia described how the price of imatinib (Gleevec) increased three-fold over a decade. This happened even though all research and development costs were accounted for in the original price, and the number of people using the drug was dramatically increasing. Heightened demand alone cannot explain such an increase.

What makes cancer drugs different

Cancer drug markets clearly behave quite differently to what we might expect. There are three key reasons for this.

First, governments are creating a “price deregulation eco-system” for cancer drugs by establishing special funds that challenge accepted standards of value, and by curtailing the ability of payers to negotiate prices. The UK government has the Cancer Drugs Fund discussed above, while US legislation limits the ability of Medicare – the US government’s health insurance program for people who are 65 and older and certain others –to negotiate drug prices. Laws in the latter country effectively force the health insurer to pay for cancer drugs used for a “medically accepted indication”, and prevent it from considering related cancer drugs as interchangeable.

In other words, US Medicare cannot make the call about whether the drug is worth its asking price, or negotiate prices based on cheaper available alternatives. The fact that the US pays the most for many drugs — including many cancer drugs — should therefore be no surprise. And if other countries are paying high prices for drugs, it makes it easier to justify these high prices elsewhere.

Second, there’s a lack of significant competition for many new cancer drugs. In an attempt to understand why South Korea paid so much less for drugs used to treat chronic myeloid leukemia — in some instances less than 20% of the US price — the same group of experts mentioned previously noted the country had its own locally discovered drug for treating this disease. The price of competing products appeared to be based on this local drug’s price.

The lack of competition in the cancer drugs market is exacerbated by the rise of new “biological agents”, which are more difficult to replicate than small-molecule drugs, and by industry practices aimed at extending the patent lives of existing products, thwarting generic competition.

Finally, markets in health care, including for high-cost cancer drugs, are powerfully influenced by existential and moral considerations — specifically fear of death and disability, and desire for greater quantity and quality of life. Cancer patients, their families and the oncologists who care for them are often willing to try drugs in the hope they will work, regardless of the price or prospect of benefit, which is frequently quite limited in the case of new, expensive cancer therapies. And as long as there are people willing to pay high prices or, as is usually the case, to demand subsidised access to cancer drugs, there’s no reason for the industry to reduce its prices.

Hope, fear and desperation, along with the unique characteristics of the cancer drug market, create a “perfect storm” that continues to drive up prices for cancer drugs. Unless we regain sight of the need to use regulatory incentives to reward only genuine innovation, and ensure that we receive sufficient value for the money we spend on new medicines, this upward trend for cancer drug prices is set to continue.

The call by the US oncologists for patients to demand reductions in the price of the new drugs may be too much of an ask as these people have more to lose in this debate. It may also be too narrowly focused as it’s not just cancer patients but all of us who should demand the drugs we need at a price that our publicly funded health systems can afford.

CORRECTION:This article has been amended to reflect the fact that the PBS lists subsidised drugs, not the Therapeutic Goods Administration it said originally.

Propaganda or cost of innovation? The high price of new drugs

Ever wonder how much it costs to develop a new drug? The independent, non-profit research group, The Tufts Center for the Study of Drug Development, estimates US$2.6 billion, almost double the centre’s previous estimate a decade ago. But how accurate is this figure?

While the details of the study remain a secret, a press release, slideshow and background document on the Tufts website provide some insight into how this figure was calculated. Interestingly, only slightly more than half of this cost is directly related to research and development (R&D). US$1.2 billion are “time costs” – returns that investors might have made if their money wasn’t tied up in developing a particular drug.

As expected, these costings have attracted the attention of policymakers, consumer advocates and critics of big pharma. In the New England Journal of Medicine, Harvard University Professor of Medicine Jerry Avorn questions several assumptions underpinning the Tufts costing – particularly the unverifiable claim that up to 80% of compounds are abandoned at some point during development.

Avorn is also unconvinced by the Tufts assertion that an annual return on capital of 10.5% (which was used to calculate the “time costs” component) is needed to attract investors, noting that “bonds issued by drug companies often pay only 1 to 5%”.

More broadly, Avorn questions the Tufts claim that its US$2.6 billion figure related to only “self-originated” products and wonders whether this includes contributions from the public purse for underlying basic science. If the Tufts figure didn’t include public contributions to research, the real cost of drug development would be even higher.

Finally, Avorn notes that pharmaceutical companies could fund much of their research themselves with the hundreds of billions of their own (untaxed) capital held outside of the United States.

Avorn’s criticisms echo those of the Union for Affordable Cancer, which complains that the study’s figures are already being used as a propaganda tool to justify high drug prices, particularly for cancer.

Like Avorn, the Union suggests that the Tufts figures also ignore the significant public contribution to drug development, particularly for cancer.

Others have argued the Tufts figure is grossly over-inflated. Rohit Malpani, director of policy and analysis at Doctors without Borders notes drugs can be developed for as little as US$50 million, and at most, for US$186 million when failures are taken into account.

Even Industry heavyweights such as GlaxoSmithKline’s CEO Andrew Witty have undermined the Tufts claims by suggesting in 2013 that the US$1 billion dollar figure was a myth.

So why is this debate important and why does it matter whether or not these estimate are correct?

These costs are used to justify high drug prices. These prices increasingly have the potential to disable health-care systems, create enormous opportunity costs (as funds that could be spent on other goods and services are diverted to purchase more and more expensive drugs), and place medicines out of reach of all but the most wealthy individuals or governments.

This is a reminder that the real issue is not how much it costs to develop a drug, but whether or not these drugs are worth the high prices pharmaceutical companies charge for them.

While advocates of a completely free market might see “just” pricing and all forms of price control as “medieval”, “socialist” or as suppressing innovation, others worry that drug prices bear little, if any, correlation with actual clinical value.

Rewarding innovation is necessary, but allowing drugs to be priced according to whatever the market will bear, rather than according to their benefits and cost-effectiveness, leads to inefficiencies, inequities and dramatic global inconsistencies.

Knowing how much it really costs to develop a drug might make it easier to negotiate drug prices on a global level and make revenues more predictable. This would not only be beneficial for society but could also ensure more predictable returns for the pharmaceutical industry.

At the moment, however, the industry seems entrenched in free-market thinking and has so far countered efforts by US lawmakers to shine a light on how much drug development really costs. While secrecy of this type may benefit industry, at least in the short term, this is simply not in the public interest.

Until we know more about the actual cost of drug development, we are in no position to meaningfully critique the corporate model promulgated by the pharmaceutical industry, the drug costs put before regulators, or the claims of groups such as Tufts. Ultimately, that leaves health systems at the mercy of industry.

Pharmaceutical companies don’t have a particularly good reputation, for some very good reasons. But we can’t let suspicions about the motives of such companies cloud our assessments of drug safety because patients may also suffer.

People with abnormal heart rhythms and other diseases that cause blood clots (thromboses) often require blood-thinning (anticoagulation) medications. For many decades, warfarin has been the most widely used such drug but it’s associated with a risk of bleeding (including fatal haemorrhage) and requires regular blood tests to monitor safety and efficacy.

So the advent of new oral anticoagulant drugs was heralded as a major advance by both patients and clinicians – principally on the grounds that they appeared as effective as warfarin, may be associated with a lower risk of serious bleeding, and are cost-effective because patients don’t need ongoing blood monitoring.

For these reasons, a number of these new drugs, including dabigatran (Pradaxa) and rivaroxaban (Xarelto) were fast-tracked through the regulatory approval processes in the United States and in New Zealand. Continue reading →

In the endless drive to get people’s attention, advertising is going ‘native’, creeping in to places formerly reserved for editorial content. In this Native Advertising series we find out what it looks like, if readers can tell the difference, and more importantly, whether they care.

Academic medical researchers are hot property for companies marketing pharmaceuticals, complementary medicines, medical devices, fitness equipment, weight loss products, “health foods” and other health-related goods and services. Their opinions are highly respected by the general public, and their endorsement in the media of a product can help to ensure consumers and patients purchase it, or at least discuss it with their “health care provider”.

But this raises a question: why would an academic researcher choose to endorse a health-related product in the general media?

The most worrying explanation is that the academic is being employed by the company to speak favourably about its product. Such commercial relationships are rarely made transparent and rely on a public perception that academics are objective observers and commentators. For the most part, however, this is unlikely to be the case.

A far more likely explanation is that any academic endorsement occurs in the context of a long and mutually productive relationship with the company concerned. Academics are frequently targeted by companies on the grounds that they provide authority and act as “key opinion leaders” who are able to influence the opinions, beliefs and behaviours of others in both professional and public arenas.

This relationship with industry is frequently one of many. Academics who comment on products have frequently partnered with the company in its clinical trials of the product; put his or her name to the resulting academic publications; provided strategic advice on how to have the product regulated and perhaps subsidised by the government; or given talks to other academics and clinicians about the research (if not the product itself). Continue reading →

The Australian Medical Association (AMA) and medical specialist groups are currently debating public disclosure of gifts received by doctors from pharmaceutical companies. The bone of contention is how valuable the freebies need to be before the doctor has to declare them.

In keeping with similar moves overseas, Medicines Australia is proposing to mandate disclosure of gifts and payments to doctors, starting in 2015, and is currently seeking stakeholder input into the technicalities of such a move. Continue reading →

CLINICAL TRIALS – Human clinical trials are an important last hurdle in the development of new drugs and therapies. Today, The Conversation takes a closer look at this vital scientific endeavour with three articles that look at different aspects of the process.

Testing new drugs in clinical trials is a billion-dollar industry in Australia, with most of the money coming from international pharmaceutical companies. But as investment grows in India, China, and other emerging competitors, some people argue we need to make Australia more attractive to such investment. One of their solutions is to water down the ethics approval process.

a nationally consistent approach to ethical standards to reduce complexity, speed up the process and where possible, rationalise the number of ethics committees to reduce the large number that currently exist.

Before major changes are introduced, however, it is important to remember that ethics committees are the very bodies that ensure the safety of clinical trials and maintain public confidence.

Developed in response to concerns about the untrammelled power of medical institutions in the 1970s, as well as reports of egregious excesses by researchers in the United States and elsewhere, the ethics committee system has become highly refined in both its processes and in the substance of the issues it addresses.

In Australia, it is also remarkably devolved and democratic, drawing in thousands of men and women from different walks of life across the country to engage in conversation, for no personal gain, about ethical issues in health care and research.

Established by hospitals and universities, the panels review research proposals and ensure they’re ethically acceptable. Their deliberations cover potential risks and benefits to both individuals and the wider society and issues relating to consent, confidentiality, privacy, conflicts of interest and protection of vulnerable participants. Continue reading →